In re M/T Alva Cape

• Decision Date: 07 January 1969
• Docket Number: Dockets 32256-32257.,No. 30-31,30-31
• Citation: 405 F.2d 962
• Parties: In the Matter of the Petition of Alva Steamship Co., Ltd., owner of the M/T ALVA CAPE, for exoneration from or limitation of liability. ALVA STEAMSHIP CO., Ltd., Petitioner-Third-Party Plaintiff-Appellant, v. The CITY OF NEW YORK, Third-Party Defendant-Appellee, and Walter A. Kidde & Co., Inc., et al., Third-Party Defendants.
• Court: U.S. Court of Appeals — Second Circuit

405 F.2d 962 (1969)

In the Matter of the Petition of Alva Steamship Co., Ltd., owner of the M/T ALVA CAPE, for exoneration from or limitation of liability.

ALVA STEAMSHIP CO., Ltd., Petitioner-Third-Party Plaintiff-Appellant, v. The CITY OF NEW YORK, Third-Party Defendant-Appellee, and Walter A. Kidde & Co., Inc., et al., Third-Party Defendants.

Nos. 30-31, Dockets 32256-32257.

United States Court of Appeals Second Circuit.

Argued September 10, 1968.

Decided January 7, 1969.

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James M. Estabrook, New York City (Haight, Gardner, Poor & Havens, J. Ward O'Neill, MacDonald Deming, Charles S. Haight, Jr., and Stephen S. Gerard, New York City, on the brief), for petitioner-third-party plaintiff-appellant.

Irving Genn, New York City (J. Lee Rankin, Corp. Counsel, and Stanley Buchsbaum, New York City, on the brief), for third-party defendant-appellee.

Before LUMBARD, Chief Judge, and SMITH and ANDERSON, Circuit Judges.

LUMBARD, Chief Judge:

This appeal presents the question of whether the City of New York may be held liable in an admiralty suit for damages resulting from a shipboard explosion which occurred in the New York waters of New York Harbor during the execution by a salvor of a negligent order issued by the City's Fire Commissioner. The district court, applying state law in the absence of any conflicting admiralty rule, held that under Section 8 of the New York Court of Claims Act¹ the City was not liable for the consequences of the Commissioner's "discretionary, quasi-judicial" order. Accordingly the Court granted the City's motion for summary judgment under F.R.Civ.P. 56, upon consideration of the pleadings and the affidavits submitted by the parties, and dismissed petitioner Alva Steamship Company's third-party complaint against the City. Since the judgment entered under Rule 54(b) constitutes a final determination of the City's liability Alva's appeal is properly before this court.

We reverse the order of the District Court. While the factual record on this appeal from summary judgment is necessarily incomplete, we hold on the facts as pleaded that the New York Court of Claims Act, § 8, as interpreted by the New York courts, does not bar Alva's cause of action against the City. The cause is remanded for further proceedings not inconsistent with this opinion.

On June 16, 1966, petitioner's ship the M/T Alva Cape was involved in a collision with the steamship Texaco Massachusetts off Bergan Point, New Jersey, in New York Harbor. At the time the Alva Cape was filled with naphtha, an explosive petroleum derivative. As a result of the collision a fire started on an adjacent tug, and soon spread to the Alva Cape. The New York City Fire Department succeeded in extinguishing the blaze, but not before the Alva Cape had suffered substantial damage.

Alva engaged the Merritt-Chapman & Scott Corporation, a third-party defendant not involved in this appeal, to begin salvage operations. The salvor promptly removed one barge load of cargo from the Alva Cape to end the leaking of naphtha from the ship's hold. At this point the Captain of the Port, a Coast Guard officer apparently acting in this instance pursuant to his statutory power under 14 U.S.C. § 91 (1964), ordered the ship removed to a federal explosives anchorage in Gravesend Bay, Brooklyn. Upon request the Captain on June 24, 1966 authorized the continued discharge of the Alva Cape's cargo of naphtha in accordance with certain specified safety procedures, which are set out in the margin.²

The City Fire Commissioner apparently did not feel that the precautions ordered by the Captain of the Port were sufficient to protect against the danger of further fires or explosions during the discharging process. On June 27, after consultation with his department's Board of Fire Prevention Regulations, but without consulting the Captain so far as appears from the record before us,³ the Commissioner issued order No. 2464-6 to the Navcot Corporation, agents for Alva. The full order, issued "in the interest of public safety," is set out in the margin.⁴ Basically it required that an inert gas be introduced into the Alva Cape's cargo compartments for the purpose of reducing the concentration of naphtha fumes to a level which would not pose a danger of explosion.

Affidavits submitted by petitioner, uncontroverted on this point, state that there were only two inert gases available which could have been used to comply with the Commissioner's order. One, nitrogen, was not suitable for introduction aboard the Alva Cape since the ship's holds were not airtight, and thus were incapable of retaining the lighter-than-air nitrogen. This left carbon dioxide as the only gas with which the ship's compartments could be inerted in accordance with the Commissioner's order. But it is alleged that the Commissioner was negligent in issuing his order because he knew, or in the exercise of reasonable care should have known, that the introduction of carbon dioxide into the Alva was extremely dangerous due to the possible occurrence of static electricity.⁵

In fact during the introduction of carbon dioxide by the salvor an explosion occurred on June 28, 1966, causing four deaths, several personal injuries, and making further salvage of the Alva Cape impossible. It is alleged that evidence exists which establishes that the immediate cause of the explosion was the presence of static electricity produced by the introduction of the gas. On June 30 the Fire Commissioner ordered that no salvage work should be performed aboard the Alva Cape, and on July 3 the ship was towed to the high seas and sunk by gun fire by order of the Coast Guard.

Prior to the explosion Alva on June 21 had filed a petition for exoneration from, or limitation of, liability arising from the original collision with the Texaco Massachusetts and its aftermath. Following the explosion Alva amended this petition and filed a third-party complaint against the City and various parties not involved in this appeal. In its complaint Alva seeks indemnity from the personal injury, death, and cargo claims, totaling approximately $4,000,000, pending against it as a result of the explosion, and also seeks damages of $188,000 for its own property losses.

We disagree with the district court's conclusion that under state court decisions interpreting section 8 of the New York Court of Claims Act the City must prevail on its motion for summary judgment. Because of the view we take of New York law we have no occasion to review the district court's holding that a state law providing for governmental immunity can be applied to defeat an otherwise meritorious admiralty cause of action seeking damages for a maritime tort. Cf. Workman v. City of New York, 179 U.S. 552, 21 S.Ct. 212, 45 L.Ed. 314 (1900).

Section 8 of the Court of Claims Act, enacted in 1920, provides:

"The State hereby waives its immunity from liability and action and hereby assumes liability and consents to have the same determined in accordance with the same rules of law as applied to actions in the supreme court against individuals or corporations * * *."

While the section waives the defense of sovereign immunity both for the State and its subdivisions, Bernardine v. City of New York, 294 N.Y. 361, 365, 62 N.E. 2d 604, 161 A.L.R. 364 (1945), New York law still holds governmental units immune from suit when necessary to prevent "the incursion of courts and juries" into the administration of municipal affairs by state and local officials. Weiss v. Fote, 7 N.Y.2d 579, 585, 200 N.Y.S.2d 409, 167 N.E.2d 63 (1960). Phrases such as "quasi-judicial" and "uniquely governmental," sometimes used to describe the types of acts for which the government cannot be sued, are not helpful in deciding specific cases. Inevitably there must be a case by case analysis of the character of each governmental act alleged as the basis of liability and an assessment of the appropriateness of subjecting the government to suit under the particular circumstances at bar. We must attempt to analogize the facts before us to the closest New York precedents under § 8, recognizing the unavoidable hazards involved in undertaking to predict the result which the state courts would reach in this case.

The closest state precedent is Weiss v. Fote, 7 N.Y.2d 579, 200 N.Y.S.2d 409, 167 N.E.2d 63 (1960), which the district court properly emphasized but we believe incorrectly interpreted. The complaint alleged that an automobile accident had occurred in an intersection because the City of Buffalo had negligently designed a traffic signal light so that it provided an insufficient "clearance interval" between the stop and go signals. The evidence, however, showed that the traffic light pattern had been designed and installed by the City's Board of Safety only after a detailed study of traffic conditions at the particular intersection. There had been no other accident at the intersection in the three year period during which the light had been in operation.

On this record Judge Fuld, writing for the Court of Appeals, held that:

"There is nothing in the record to suggest that the Board of Safety\'s decision was either arbitrary or unreasonable. To state the matter briefly, absent some indication that due care was not exercised in the preparation of the design or that no reasonable official could have adopted it — and there is no indication of either here — we perceive no basis for preferring the jury verdict, as to the reasonableness of the `clearance interval\', to that of the legally authorized body which made the determination in the first instance." Id. at 586, 200 N.Y.S.2d at 413, 167 N.E.2d at 66.

* * * * * *

"Liability for injury arising out of the operation of a duly executed highway safety plan may only be predicated on proof that the plan either was evoked without adequate study or lacked reasonable basis." Id. at 589, 200 N.Y.S.2d at 416, 167 N.E.2d at 68.

The City relies heavily on...